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Australian Defence Industry Account, experimental estimates

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Estimates of the defence industry's direct contribution to the Australian economy

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Reference period
2020-21 financial year
Released
30/09/2022
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Key statistics

  • In 2020-21, Defence expenditure contributed $8.88b to Australian economy, as measured by Gross Value Added (GVA)
  • "Professional, Scientific, and Technical Services" accounted for 41.4% of Defence GVA
  • The highest contributing state was New South Wales, contributing 29.9% of Defence GVA

Broad overview

Australian Defence Industry Account

The Australian Defence Industry Account (ADIA) is a satellite account that measures the direct economic contribution of the defence industry to the Australian economy.

Australian defence industry

The Australian defence industry represents the production of goods and services invoiced to the Department of Defence. For example, if a vehicle manufacturer supplies vehicles both to Defence and broader economy, only the activity associated with the vehicles supplied to Defence is captured. 

Only the direct defence industry contributions are included. For an activity to be included as part of the defence industry, there must be a direct relationship between the Department of Defence and the supplier of the good or service.

The account presents estimates of Gross Value Added (GVA) of the Australian defence industry to the Australian economy disaggregated by state and industry division. For more information on the methods used to derive GVA please see the methodology. 

Gross Value Added (GVA)

GVA represents the additional economic value added through the creation of a product or provision of a service. It removes the costs of intermediate inputs used to create the product or service from the amount received by the seller. It is the standard indicator to assess the contribution of an industry or sub-sector to the broader economy. 

Total defence industry Gross Value Added

Defence industry GVA records the value added to the economy as a result of Defence expenditure. An increase in Defence expenditure in 2020-21 led to an increase in defence industry GVA:

  • Total defence industry GVA in 2019-20 was $8,399m
  • Total defence industry GVA in 2020-21 increased by 5.7% to $8,877m

When compared to the national GVA, the defence industry's contribution to total GVA was: 

  • 0.45% in 2019-20
  • 0.46% in 2020-21

Note: This contribution does not reflect the total contribution of the Defence portfolio to the Australian economy. It only captures the GVA generated as a result of the invoiced expenditure made by the Department of Defence. 

Industry overview

The three largest industries contributed approximately 75% to the total GVA generated as a result of Defence expenditure in 2020-21. These are:

  • Professional, Scientific and Technical Services, contributing 41% of defence industry GVA. The key contributors for this division are engineering design and consulting services, and computer system design and related services.

  • Manufacturing, contributing 18% of defence industry GVA.

  • Construction, contributing 15% of defence industry GVA

Notes: Divisions F, H and Q are suppressed due to confidentiality requirements. 

State overview

Estimates of total GVA associated with Defence expenditure are presented by state and territory below. The top three states / territories were: New South Wales, Victoria, and the Australian Capital Territory.

  • New South Wales contributes 29.9% of the defence industry GVA
  • South Australia's defence industry GVA grew by 11%
  • Western Australia's defence industry GVA decreased by 4%

Note: While these estimates should ideally allocate GVA to the state in which a product was produced or where a service was provided, this is not always possible. For example when invoiced expenditure occurs across multiple states or when the invoice is sent to the head office. In these cases the GVA is allocated to the main state of operation for the supplying business.

Additional notes

Upcoming releases

This release presents initial GVA estimates by industry and state / territory. A second release in December 2022 will expand these estimates to include:

  • Employment
  • Sectoral breakdowns
  • A longer time series

Data downloads

Australian defence industry data cube

Data files
Download xlsx [429.24 KB]

Methodology

Australian Defence Industry Account, experimental estimates methodology, 2020-21 financial year

Media releases